USD Slipping Lower Despite Better Housing Starts Figures
Today markets have been quite slow, with the Bank of Japan being at the center of attention for the day. And, once again, the BOJ let the JPY bulls down, by maintaining the status quo and not giving clear hints of changes changes. USD/JPY surged higher, but this came all from the JPY side of the pair, since the USD itself has been weak against other major currencies.
BOE governor Ueda said that they will wait until the spring salary discussions before making any commitments. which sent the JPY around 200 pips lower across the board. USD/JPY surged from around 143.60s to 145, although it has retreated 100 pips lower in the last hour or so, and we decided to open a buy forex signal here.
The 50 SMA (yellow) which used to act as resistance is turning into support on the H4 chart. Although, let’s see if this moving average will hold the retreat in the USD. The US housing sector is looking stable, with housing starts and building permits posting a jump in November. However, this is not helping the sentiment for the USD.
US Housing Starts and Building Permits for November 2023![Housing]()
- Housing starts November 1.560 million versus 1.360 million estimate. Biggest jump since 2020
- Prior month housing starts 1.359M
- Building permits 1.460 million versus 1.465 million estimate
- Housing starts MoM +14.8% versus +0.2% last month (was 1.9%)
- Building permits MoM -2.5% versus +1.1% last month
The plot revolves around the availability of housing. Higher interest rates have not helped this situation. Builders have subsidized buyers at their expense. Mortgage rates are falling, which may encourage additional construction but also reduce incentives. We’ll have to wait and see how the situation develops next year.
USD/JPY Live Chart
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